Continued from Neoliberal Liberty and the market
Most human societies have not required States, and according to James Scott that includes some early, fairly large scale, settled agricultural societies. Many of these non-state based socieites seem to actively resist those processes that lead to State formation, such as: a) accumulation of wealth by kinship or position; b) the monopoly of approved violence, or; c) the monopoly of religious positions. Fighting the accumulation of wealth to prevent the State forming, is vitally important as the wealthy can, as I’ve said previously, often buy other forms of power, such as being able to afford military specialists over many generations.
This point about resistance to power is important; these stateless societies are not the kinds of societies praised by neoliberals. They are not capitalist societies. In particular they are not corporate capitalist societies. And, they are not necessarily societies in which everyone is free. Old people often rule over younger people, men over women etc.
However, in all these societies (as is normal), people co-operate, or team-up to expand their, and others, capabilities and survival chances, and (in this case) to prevent the formation of a State, or power elite, or wealth elite.
‘Teaming up’ will always occur. To some extent, corporations and states arise out of this natural trait and, as a result, have many institutional similarities and weaknesses. Humans are both competitive and collaborative creatures, and a society which does not realise this active ‘contradiction’ will probably be suppressive in some way or another. The point is that organisation, and disorganisation, do not necessarily require a State. States may come about when the activities which prevent them from forming are suspended.
My supposition, based on the behaviour of historical States, is that the main need for States arises to protect people from other States, or other large scale organisations. Once military states are established they tend to spread to gain resources to feed their soldiers and support the expansion. Similarly, corporations tend to spread to gain resources, and again historically have used violence to do so if people are not interested in providing resources, buying corporate products, or selling their own labour. As implied elsewhere, crony capitalism and the take-over or an existing State, or generation of a new State, are normal parts of capitalism. Capitalism does not exist without States, so capitalists are never going to completely break up the States they own, so they can keep the laws and threats which enable them to operate.
However, States and corporations are not monolithic bodies but sites of conflict, with competing departments, friction inside deparments, conflicting policies, different linkages to insitutions outside the themselves, different problems of survival, and so on. This factionalism may help liberty, if it stops one faction from exerting complete control. Again, the more the sources of power are kept separate, and wealth is controlled, the greater the chance that one source of power will not dominate.
Neoliberalism and the State
Neoliberalism promotes the idea that the weaker the state the more liberty we get.
There are clearly limits to this after a State has been established. A collapsed state is a weak state, and unlike real stateless societies, the collapsed state tends to involve continual violence. In this situation there may be little constructive liberty. People are reduced to attack and defense, and organisation for attack and defense. Survivial compulsion is dominant over every form of liberty.
The idea of the weak state is a driving idea in communism as well as in neoliberalism. The State is supposed wither away after the revolution. Of course the communist state doesn’t wither away because it is needed to impose order after the revolution and protect the revolution and is easily hijacked by ruthless people who appear dedicated to the revolution. The same seems true of the neoliberal State, it does not dissolve after the revolution, but reinforces the neoliberal takeover, attempts to put down opposition, and is easily hijacked by ruthless people.
I would tend to argue, unless contrary evidence is provided, that the evidence suggests that the neoliberal weak state, is strong when it comes to defending and ‘nannying’ the established corporate sector, while weak when it comes to defending or enabling ordinary people. For example, the neoliberal State would much rather protect established fossil fuel companies, than attempt to do anything about climate change, no matter how costly it is to the general population. In other words the neoliberal weak-State argument seems to be a deceptive rhetoric used to help support plutocracy – or government by the wealthy classes
This is largely a guess, based on observation of what has been happening over the last forty years of ‘small State’ and ‘free market’ talk (and forty years is long enough to assume that we have attained as much of the aims of the movement as is possible or likely). However, the point is that rather than assume a small state is necessarily responsive to voters/locals we have to look at how corporations interact with smaller States. This requires research, which is beyond the scope of this blog.
In neoliberal capitalism, do people get more or less control over their lives as a result of weakening the State? Getting more control over their lives seems unlikely unless the State is particularly bad.
Corporations vs the State
Corporations both need, and support the State, to support their ways of action and accumulation. However, they can easily dominate the State rather than be dominated, especially nowadays.
Modern corporations are motile. The have ‘span’, they have wealth. They may need an area of land, but they rarely need a particular area for ever. They use it for as long as it is profitable, and can move on. They can be multi-sited, officially based elsewhere to transfer revenues and profits out of the places they operate in.
On the other hand ‘States’ are place bound, they are in competition with other states, and they may have less money than corporations.
In this cirumstances there is a definate power imbalance.
Corporations can promise they will set up in the place with the lowest tax rates, lowest restrictions on pollution and so on, setting up a competition between weak States. The people of those States can be bombarded with pro-company propaganda (media disinformation) which does not specifically have to be untrue, but it can leave out harms, and exagerate benefits – just as Adani (with the help of its politicians and the Murdoch Empire) has exaggerated the numbers of jobs and revenue its mines will bring, and downplayed the likely danger to the water table, and other damages to the ecology. Poorer small states are more likely to agree, and thus earn less and become more able to poison their people, or ignore the massive degradation produced by corporate activity. Often if the area is poor, they may consider that the price of pollution is worth the jobs they might get.
They may find they never get those jobs of course, people may be flown in from elsewhere, due to local skill lacks, or the expected lack of imported labours’ ability to unify and challenge the disruption to local lives, their allocated work practices and wages given . The company may also not pay the wages fully and just move out if there is trouble – as stated previously they are motile with no lasting relations to place or the small State’s exercise of power. Or they can destroy the environment, take all the minerals etc. and leave waste and destruction behind. This kind of normal and passing behaviour, with no longer term investment, can produce short term booms which destroy local economies in the longer term, as seems to be recurrent with fracking.
Often small states do not know the consequences of some forms of development, say mining, and it can be difficult to challenge the corporation in courts to get resitution for the destruction. It might well have proven more economic and beneficial to support local companies, but they can have less influence as less wealthy.
Neoliberal Privatisation
A major part of the neoliberal weakening of the State is for the State to hand over common (tax payer owned) property to the private sector, or to contract out state services to the private sector. This is known as privatisation. Experience shows that this almost never delivers better, more liberty respecting services cheaper. It just means that more parts of life get handed over to the control of business, and that the power of business over the lives of people increases.
It has also increased the potential for corruption, and handing of public property to ‘friends’ at knock down prices, also costing government revenue, but giving free revenue to businesses.
Often public needs become controlled by non-local forces, and the State, and the popular voice, has little power to change things, without alienating these powerful forces. Thus when the State privatises water supplies, we gain situations in which rivers run dry because of large private storage, and towns die because they cannot afford the costs of the water (just as people may starve if they cannot grow their own food and cannot pay as much for food as people in some other market). Perhaps the wealthy keeping the water for their own profit or agriculture was the prime requirement of the privatisation. In one circumstance I heard of, the company who bought the water, turned the local reservoir land into housing estates, made a quick profit, and left the area with a water shortage.
Private jails are best served by rescidivism, and returning custom, rather than reform of criminals, and so on.
If you really believed business was more efficient than government, you would rent out poorly performing and unprofitable government ventures to private enterprise, to see if they could provide better services for less cost and make money out of this. However, neoliberals usually sell off, or give away, the profitable arms, or properties, of government, making sure the State debt increases, while allowing the new owners to deliver inferior services, sack staff and massively boost the incomes of their high-level executives. It’s a redistribution of property and income away from the people.
The Useful Function of the State
The State is a site of conflict, and political process. A participatory State has the capacity to include people in the politics of organising themselves and co-operating with others. Without a open State, such processes can only happen at a small scale, and large scale processes will be controlled by the dominant groups.
The theory of the small state also depends upon whether you think of liberty as absence of compulsion, or as being enabled and requiring people to be able to participate in governance with others. In reality the neoliberal state only opposes compulsion for the wealthy, and perhaps those who support them.
As we can see in Australia, the financial industry and building industries can committ massive crimes against its customers, but that is of little concern to the neoliberal State. Corporations are not compelled to be honest, while neoliberals are seeking to make sure that unions can be deregistered for failing to fill in forms absolutely correctly.
The neoliberal State, like the communist State, is in practice only vaguely participatory. It needs to reinforce the dominance to lower the chaos it generates, and lower possible action on behalf of ordinary peoples liberties. You elect representatives and then leave them alone to get on with whatever they choose to do, or choose to sell out to. The small State is to be controlled by the corporate class and their representatives alone, which is why popular participation is discouraged.
Conclusion
In a capitalist system, given that the corporate world remains strong, then it is even easier for them to take over a weakened state and set up stronger plutocracy and reduce liberty to that form of life which is compelled by the market that they largely manufacture the rules of. This may well be why the corporate sector encourages the theory of the small state as liberating. – although they always use the State the strengthen themselves and weaken others, by such acts as increased military spending, suppressing anti-capitalist protests, encouraging pollution, suppressing constraints on corporate power and profit, and making workers weaker by removing non-capitalist enabling support. This take over is relatively easy when they almost completely control the means of information.
Small states may be particularly vulnerable to strong corporate power, because the power differential is higher, and because of the absence of non-pro-corporate ideologies.
I suspect that, in our societies, you have to weaken the corporate sector to if you really want to weaken the State and allow liberty. You may also have to strengthen places of potential opposition against plutocracy.
Continues in: Recapitulations of Neoliberal Liberty and ways to remedy it.
Tags: neoliberalism, politics
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